This is my second blog looking at the key stakeholders for a SAP FSCM implementation. To help show the difference between the priorities for each stakeholder this blog will follow the same format as my initial blog: ( What CFO’s need to know about FSCM )
For an overview of what business issues SAP FSCM tackles and the functionality within SAP FSCM please review the following blog What exactly is SAP FSCM – a high level guide to the processes and the benefits
Why the CIO?
The CIO (Chief Information Officer) will have different focus points to that of the CFO. The CIO will be focused on providing the best solutions to meet the business requirements of an organisation. Within an Organisation the CIO will be accountable to the various business functions to ensure their teams have the correct tools to perform their job. Further to this they will need to ensure that the costs are manageable and new implementation can add real value to the Organisation.
Relevant responsibilities of CIO
- Common platform for solutions
- o Having wall to wall SAP can have its benefits. By having a single main platform the business reduces costs for training, licenses, and support.
- Be aware of new products and new developments
- o This can be tied in with the first responsibility. By being aware of new technology and new functionality, the CIO needs to be sure the correct products are being utilised and align to the Organisation’s strategic roadmap.
- Prioritise implementation and IT spend
- o Various business departments will be banging on the CIO’s door demanding improvements in technology. The Sales-force will require the latest and greatest technology. The CIO needs to ensure any new implementation does not add further indirect costs through 3rd party licenses, support and maintenance. Further to this, some projects will not provide a reasonable ROI – there will need to be some give and take in the various prioritisations of the planned projects.
Benefits of FSCM for CIO
After reviewing the prioritisations of the CIO – the business case you need to present must show the following:
- 1. Achievable ROI
- 2. Remove 3rd party systems
- 3. Provide the business significant benefits
How does this affect a standard SAP Organisation?
If we review an average SAP Organisation. They implemented SAP say 10 years ago on, say a 4.0 or a 4.6 system. FSCM was not available and it is widely acknowledged the standard SAP solution was poor in the Accounts Receivable processes. That Organisation would have reviewed SAP and done one of 2 things. Designed a bespoke process to handle this in SAP. This would be hard to upgrade and will not benefit from the new functionality available in the latest SAP Enhancement Packages. The second option would be that they purchased a 3rd party system that they then linked (interfaced) to SAP. The Cash Collection team would then need to utilise both systems. They would need to be trained in both systems. Their business processes would be hampered as at times two sessions would need to be open.
Move the clock forward. The same Organisation that purchased the 3rd party solution performed a technical upgrade last year. The business did not see too much benefit or hindrance from this activity. However the CIO spent a lot of his budget on the upgrade, and has not provided the business with any “business lead” benefits. Please review my blog on the business of FSCM for tips around business lead benefits – How to truly maximise the benefit of your FSCM implementation . If you position your business case around the business benefits that the CIO’s Organisation will gain from implementing FSCM you may get your toe through the door. If you follow this up by pointing out that you would be removing direct IT costs through the removal of the 3rd party solution – so no more licences, support, maintenance and hardware costs then you will gain their attention. However to fully grasp their attention detailed work needs to be done to provide achievable ROI.
I would recommend you only focus on the business lead ROI – by this I mean streamlining of the cash collection team, improved DSO KPI and a happier workforce as the users would have prioritised work-lists in a single system that utilised the single common platform (SAP). Further to this you will be aligning the CIO and the CFO. They will now share the same vision and provide dual support of the project.